Chapter 27 215 licence

Which of the following constitutes replacement?

All the above

The use of an IRREVOCABLE beneficiary option may do all the following EXCEPT:

Does not restrict the owner in the use of the loan values in the policy. Explanation:Nothing may be done to the policy without the irrevocable beneficiary's signature.

Who regulates qualified retirement plans?

ERISA Explanation:Employee Retirement Income Security Act (ERISA)regulates qualified plans. It sets forth funding , participation, vesting, termination requirements, etc..The state does in fact regulate financial planners but not retirement plans.

An insurer must establish a suitability supervision system including all of the following EXCEPT

Limiting annuity replacements to agents with two or more years field experience

Which of the following statements is not correct regarding an association group?

must have been in existence for one year Explanation:The association must have been in existence for two years. Examples are CPA's, Lawyers, etc..

Which of the following is called the fifth dividend option?

term Explanation:The dividend options are CRAPT...Cash, Reduce the premium, Accumulate with the company, Paid-up insurance, Term (annual renewable term)

All of the following are correct insurance agent marketing responsibilities EXCEPT

A presentation may not include references to life insurance policy cost indexes

Which of the following is NOT considered to be an element of replacement?

An existing policy is subjected to a loan of 10 percent of its value.

All of the following statements about life insurance benefits are correct EXCEPT

Benefits payable to the insured's estate are protected from the creditors

To comply with disclosure requirements, producers must deliver which of the following documents to all insurance applicants

Buyer's Guide & policy summary

All of the following statements regarding the life insurance policy summary are correct EXCEPT

It must illustrate all guaranteed policy dividend values

All of the following are correct about the policy loan interest rate EXCEPT

Policy loan interest rates were set by the Office of Insurance Regulation in 1933 and may not be changed

The Florida Uniform Simultaneous Death act

Provides that when it is impossible to determine who dies last it is assumed the insured died last ,It was designed to clear the way for paying claims

All of the following are eligible groups under Florida law EXCEPT

Social clubs

All of the following statements are correct about the law for conversion (change of plan) EXCEPT

The maximum amount of face value that can be converted is $2,000

Who can negotiate viatical contract?

Those holding a life insurance license Explanation: Only licensed life insurance agents may negotiate these contracts.A viatical settlement broker is deemed to represent only the viator (the owner of the policy) and owes a fiduciary duty to the viator to act according to the viator?s instructions and in the best interest of the viator.

All of the following groups are eligible for group life insurance EXCEPT

groups established to buy insurance

Titus has absolutely assigned his $100,000 life insurance policy to the bank to cover a $75,000 mortgage. His wife is named as primary beneficiary. If Titus were to die which statement correctly reflects the insurance company's obligation?

the bank would receive the entire amount Explanation:Titus should have elected a collateral assignment, in which case the bank would have only been paid the balance of the loan. Since he did an absolute assignment, the bank would receive the entire amount.

How will a beneficiary naming a former spouse on a preexisting insurance contract be changed by the divorce?

the beneficiary designation is voided by the divorce

Florida rules on disclosure require:

A 14 day free look and buyers guide provided at delivery

A life insurance company's legal reserve shows on the balance sheet as:

A liability

Suitability information gathered from consumers must be retained for review by the department

By both agents & insurers for 5 years

Which of the following actions accurately portrays the limit Florida insurance regulations set for the combining of advertising for insurance policies with association membership?

By requiring separate applications and separate signatures

All of the following statements are correct about group life insurance EXCEPT

Certificate holders need not be notified if the policy expires

All of the following are features of non-participating policies except:

Dividend options Explanation:Non-participating policies do not pay policy dividends.

Mammy had a $100,000 policy which which had $25,000 of cash value. Mammy used the cash value to purchase a Variable Universal policy with the same insurer that allowed her to choose the investments. Which word best describes this?

churning Explanation:When a policyholder uses the cash value of one policy to buy another it could be considered churning.

Which of the following statements applies to the rights of a surviving spouse under a group insurance policy?

Conversion privileges must be provided for dependents

Which of the following applies when an insured wishes to convert industrial insurance policies for an ordinary policy?

It is possible to convert $3,000 or more of industrial insurance.

Which of the following is the correct number of lives required in Florida for a group life insurance policy?

No minimum

All the following statements concerning the Tax Treatment of life insurance are true EXCEPT:

Premiums paid for life insurance in non-qualified plans are deductible.

Under group life insurance, which of the following statements is CORRECT?

If cancelled, the members must be notified

Which of the following statements about the Misstatement of Age provision in a life insurance policy is true?

If the insured's age has been understated, it provides that a Death benefit smaller than the face amount of the policy will be payable. Explanation: Age is not a material fact. So , the company must pay. Even if the mistatement was a lie. However, the company reserves the right to adjust the benefit. A material fact is a fact that would have altered the decision by the insurance company to issue the policy. Drugs, for example. If the insured lied about drug use, the claim would be denied because the insurance company would not have issued the policy.

In which of the following ways is a beneficiary protected from the creditors of the deceased insured?

If the policy is made payable to a named beneficiary, then the creditors can make no claim to the proceeds

Which of the following is correct about the replacement rule?

Instructions regarding the rule are available from appointed life insurers.

All of the following are duties of the replacing insurer EXCEPT

Insure that all appointed agents take a 2-hour course on replacement annually

Which of the following statements is correct about group life insurance

It is written with a master policy for members of qualified groups

Which of the following must be given to an insured when a replacement occurs?

Notice regarding replacement

For an individual life insurance contract on an insured 64 years of age or older, the insurer must advise the applicant

Of their right to designate a secondary addressee to receive a copy of any policy lapse notice

Which of the following is NOT a duty of an agent when replacing a life insurance policy?

Presenting to the applicant, at time of policy delivery, a "Notice to Applicant Regarding Replacement of Life Insurance" Explanation:The agent must present to the applicant a "Notice to Applicant Regarding Replacement of Life Insurance" when taking the application and NOT at policy delivery.

Which of the following rules would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance?

Replacement rule

The Viatical Settlement Act

Requires licensing for brokers and providers Allows licensed life agents to perform the functions of a Viatical Broker Provides for regulation of these products by the Dept. of Financial Services

Which of the following is NOT required when a group life insurance policy is canceled?

The policy owner must notify the department of the cancellation

All of the following statements are correct about policy loan interest rates EXCEPT

There are no restrictions or limitations on policy loan interest rates

Which of the following is correct concerning the grace period for folks aged 64 & over?

They are afforded an additional 21 days of grace 3. Does not apply to policies held less than one year Folks 64 and older are afforded an additional 21 days of grace if they have held their policies for more than one year. These requirements do not apply to policies that payable monthly or more frequently.

Which of the following are disadvantages of naming the insured's estate as beneficiary:

Creditors can easily attach the proceeds II. Proceeds increase the size of the estate III. If there is a will it may be contested. IV. The advantages of settlement options are lost

All of the following information and much more must be gathered from an annuity applicant in order to determine the suitability of the sale EXCEPT

Membership in any civic clubs or organizations by the applicant